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Agricultural insurance and agricultural productivity: Granger causality test: An application in the United States

Author: 
Ezdini Sihem
Subject Area: 
Social Sciences and Humanities
Abstract: 

This article tries to show the existence of the causality between the agricultural productivity and the development of the agricultural insurance and this by resorting to an econometric approach using Granger Causality Test. This econometric analysis is made over the period 2000-2012 for one of the American country to know the United States. We found interesting results in this connection which reflect the state of the agricultural insurance and the implications of its use to allow the preservation of the agricultural performance. Besides, we showed in term of causality the implications of the application of the agricultural modalities of risk management on the agricultural productivity. In United States as in the developed countries, the agricultural insurance acquires a big importance as far as it is used for a long time as one management tool of the agricultural risks. Through our econometric analysis, we try to show the existence or not of a causality between the agricultural productivity and the development of the agricultural insurance in the United States during period 2000-2012. To be made, we shall test the existence of a relation of cointegration between the variables which are used and we shall proceed by a study of the stationarity of the series to determine their orders of integration. By applying Granger causality test, we show the existence of an unidirectional causality between the development of the agricultural insurance and the agricultural productivity in the United States and we also identify the existence of an unidirectional causality enter the development of the agricultural insurance premiums to United States and the agricultural productivity enters the period 2000-2012. These two results confirm our working hypothesis which stipulates the existence of causality between the development of the agricultural insurance and the agricultural productivity in the United States.

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